Promises not kept in Northside Jacksonville CDD

Amenities lured buyers, but real-estate meltdown keeps district from building

Article Courtesy of The Florida Times Union
By David Bauerlein
Published September 8, 2009


The promise of a recreation center with a swimming pool overcame Phyleshia Jones' initial wariness about buying a home in the Villages of Westport, a community development district on Jacksonville's Northside.

Three years later, the recreation center with its pool and playing fields hasn't been built and there is no target date for when it will be.

Jones is paying about $1,300 a year in community development district assessments - money she expected would take the Villages of Westport to the next level, but instead is just a financial drain on her.

"We kind of feel shafted," she said.

The holdup over construction of the recreation center shows how the economic downturn is affecting one community development district. The Villages of Westport is one of several dozen community development districts that were formed across Northeast Florida when residential developments were popping out of the ground, home prices were shooting up, and builders scrambled to meet the demand.

But the real estate meltdown brought those developments back to Earth. At the Villages of Westport, some streets have homes, but they are in the midst of acres of vacant lots.

The Villages of Westport Community Development District could build the recreation center, but that would require an increase in the assessments charged to property owners so the district can cover the day-to-day expenses of operating and maintaining the recreational facilities, officials said.

The district hasn't done an analysis of how much the additional assessment would be, but it would probably be several hundred dollars per single-family lot owner, said Jim Perry of Governmental Management Services, which manages the district. He said in these tough economic times, increasing the assessment by that much is not something the district's board of directors wants to do.

He said much smaller increases in assessments at community development districts have caused outrage among property owners.

Located off Dunn Avenue west of Interstate 295, the Villages of Westport has been marketed as a master-planned community. The Web site for the project says its "community features include an impressive swimming pool, tennis courts and multi-use playing fields."

Andrew Hampton said he bought a home in 2007 based on that plan.

"My wife and I had looked at 50 houses all over Jacksonville," he said. "They sold us on the master-planned community."

Davina Butler and her husband bought a home in 2008 and expected the recreation center would be great for bringing up two children.

"Now, here it is two years later and we still don't have it, and nobody is responding to us," Butler said. "We get letters when fees are going up but nothing more."

Under Florida law, community development districts have the authority to issue bonds for construction of many aspects of a development. Perry said in some cases, districts have built the recreation center before any homes are sold, while in other places, districts have waited a few years to put in those amenities.

"It really is a mixed bag," Perry said.

The Villages of Westport district issued bonds for the construction of streets, drainage, utilities, entrance features, landscaping and the recreation center. Governmental Management Services did not respond to questions left by e-mail and voice mail about the dollar amount of bonds. But according to court records filed in 2004, the district has authority to issue up to $57 million in bonds.

To pay off the debt, the district charges annual assessments. The current assessment for the debt is $1,147 for each single-family lot. The assessment is the same regardless of whether there is a home on the lot. If a homebuilder owns 10 single-family lots, for instance, the total assessment would be $11,470.

In addition, there is another assessment for the operations and maintenance. For the current fiscal year, the charge was $136 per single-family lot.

The responsibility for governing the district rests with a five-member board. The board is elected, but in the early years of a community development district, voting power is based on who owns the most land. That gives the developer the ability to select the board members.

If the board were to build the recreation center, it would have to increase the operations and maintenance assessments for everyone - homeowners and homebuilders alike. For homebuilders, the higher cost would come at a time when they are struggling to pull out of the market free fall.

For the fiscal year starting Oct. 1, the Villages of Westport board will tap its reserves and eliminate entirely the assessment for operations and maintenance. However, the district still will collect the $1,147 assessment for the debt payment.

Jones said she's torn over whether the district should build the recreation center and increase the assessment to pay for its day-to-day expenses. She said that's what homeowners were sold on. But she adds that no one told her when she bought her home that assessments would be increased for the recreation center's operation.

"People who are planning to stay here long-term would probably bite the bullet and pay it, but that's not in my plan to stay long-term," she said.

Jones said she plans to sell her house as soon as she can. She said if she ever moves to another community development district, she'll make sure everything that's supposed to be built is already in the ground.